Pent-up demand for townhomes building in the GTA

Condos may be the choice for many in the increasingly expensive GTA, but not everyone wants to live in a box in the sky. More and more new home buyers are looking for affordable lowrise options such as townhomes. Emphasis on the word affordable.

The problem? The supply just isn’t there – and the pent-up demand is growing.

Appealing especially to young families, townhomes provide more space and flexibility than condos, and generally are far more affordable than single-family homes.

Altus recently studied the sector for one of its regular housing reports, surmising that townhomes play an increasingly important role in in the new home sector, not just in the GTA but across Canada.

In the GTA, new townhouse sales have plummeted in the past two years – both in absolute terms and as a percentage of total new home sales (to just seven per cent of the total in the first half of 2018), Altus says.

Affordability and availability remain an issue.

In the GTA, the key challenge to supplying this built form has been finding land with the right entitlements to allow and support this construction, Altus reports. Much of the land along Toronto streets support higher density condo product or is priced at a level which encourages rezoning to support this density.

“What can support more townhouse development is allowing rezoning of the land between the existing single-family communities and the corridors for more mid-density development,” Boukall says.

Although townhouse land (medium density) sales in 2017 were actually up over 2016, they are trending lower in 2018. Part of the problem is a lengthy approval process. “Year to date in Toronto, we have only tracked five approved townhouse projects, representing less than 350 units,” says Boukall. “Obviously, we need more product to meet the market demand. The positive note is that developers are proposing more product, with almost 1,500 new units applied for in 2018.”

STACKED TOWNHOMES

Stacked townhouses, in which one row of townhouse units is stacked on top of another, provide a more affordable option to single-family homes, given higher densities. They also offer many of the appealing aspects of condominiums, but without living in a highrise environment.

However, they still play a relatively smaller role than traditional townhouses in the overall townhouse arena, Altus says.

In the Vancouver market, for example, new stacked townhouse units accounted for slightly more than 200 sales on average per year in 2015-17 – about six per cent of all new townhouse sales.

In the GTA, where stacked townhouses have made a larger dent, they remain a niche segment, accounting for about one in five new townhouse sales in recent years.

Part of the challenge with stacked townhouses versus rowhomes are those similar to condominium apartments – longer planning and construction timelines, and other residences adjacent on all sides

Both housing types will play an important role throughout the GTA in the future, but stacked townhouses are expected to become more popular given the better affordability provided by the higher density housing type.

“That said,” Boukall adds, “traditional row townhouses are the more common housing type in the GTA and as such, account for more sales compared to the stacked townhouse product. Row townhouse product has been accounting for a growing share of the single-family new homes sales in the GTA, currently accounting for 42 per cent of the total single-family sales activity in the GTA.”

WHERE IN THE GTA?

So, prospective GTA new home buyers, which areas hold the most promise in terms of future townhome availability?

While townhouses are expected to remain a popular housing option throughout the GTA, both Toronto and the York region share the most medium density land activity in the region, and should see increased development activity as a result in 2019 and beyond.

“The Peel region, most notably Brampton, is the most active for stacked and row townhouse sales in 2018 and should continue to see demand supported by an available land supply and comparably affordable prices,” says Boukall.

The Canadian Home Builders’ Association (CHBA) has named Bob Finnigan, partner at Herity (Heathwood Homes), CHBA Past President, member of BILD (GTA) and long-time building industry executive, as its Member of the Year.

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BIG STYLE, SMALL SPACES: Townhouse Living

There are a lot of advantes to living in a townhome

Townhouse living has a lot of perks. It’s an ideal choice for a family who wants the feel of a single-family home without all of the maintenance responsibilities that go along with it. Also advantageous is the fact that many townhomes are typically built in a neighbourhood development (so you get that great community feel) with a multi-floor plan, designated parking spots and/or garages.

With Toronto home prices soaring over the past several years, many people can’t afford the deposit on a new home, while the idea of moving into a condo or an older home is equally as unattractive.

I’ve been working with Dunpar Homes on a fabulous new townhouse development called The Ossington, and what makes it incredibly unique to the Toronto market is that they’re not only absolutely stunning, they’re rentals. Yes, you heard it here first. Luxe, beautiful townhomes for rent on Ossington Avenue between Dupont and Davenport.

These are seriously next level. Each Georgian-style home has incredible features: nine-foot ceilings on the main floor, a gas fireplace, stainless steel appliances, granite countertops and custom cabinetry (plus soaker tubs and double-sinks), but one of my personal favourite features is the ground-level gardens and rooftop patios.

If you’re thinking of buying a townhouse (or renting at The Ossington) here are a few of my main reasons you may want to strongly consider it:

A CLASSIC THAT NEVER GOES OUT OF STYLE

There’s a certain historic and timeless quality of a townhouse. They’re found in virtually all great cities of the world – Paris, London, Boston, New York City and now Toronto. They stand the test of time.

ALL THAT GREENSPACE

Whether you’re hosting a backyard barbecue or creating your own little garden, your outdoor space is your small oasis. Plus, some townhome associations include lawn maintenance and landscaping for a monthly fee.

LOWER MAINTENANCE

The maintenance of a townhouse is far less than a single-family home. Typically in a townhouse community, the homeowners’ association handles all the external maintenance to ensure a uniform appearance across all homes in the community and the owner is responsible for basic maintenance of the interior.

PART OF THE COMMUNITY

Because townhouse residents tend to live in close proximity of each other, you have the opportunity to really get to know your neighbours and build that tight-knit community. This can also give you peace of mind knowing you’re all looking out for each other.

MULTI-LEVEL IS A MAJOR PLUS

One of the nice benefits of living in a townhouse is the multi-level floorplans. You will have plenty of space (and privacy) for you and your family with bedrooms upstairs, spacious kitchens and even the option of fully finished basements.

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Record October 2017 for new condo sales

Average price for available new detached homes rises to $1,548,888

New construction home sales soared in the GTA in the month of October, primarily driven by sales of multi-family homes, condo apartments in highrise and midrise buildings and stacked townhomes, the Building Industry and Land Development Association (BILD) announced November 24.

There were 5,377 new homes sold in October, according to Altus Group, BILD’s official source for new home market intelligence. About 91 per cent of them (4,884 units) were multi-family homes and only 9 per cent (493) were lowrise single-family homes such as detached and semi-detached houses and townhomes. Condo sales for October were 81 per cent above the 10-year average of 2,697, and the highest October yet recorded, while lowrise sales were 64 per cent below the 10-year average of 1,388.

As of the end of October, 39,476 new homes have been sold in the GTA in 2017, 82 per cent of them condo apartments in highrise and midrise buildings and stacked townhomes.

“October data shows that the new homebuyer is left with very little choice when it comes to purchasing a new home,” said BILD president and CEO Bryan Tuckey.

“Provincial intensification policy has our members building more high and midrise dwellings making housing choices a challenge. The cost of a single-family home is out of reach for many consumers pushing them to buy a condo over a house. As a result we are seeing record-breaking condo sales and higher prices this year for new lowrise homes.”

While supply of new housing increased again in October and reached 12,500 units, it is still well below what is considered a healthy level. Supply of new housing is typically measured by the number of new homes available for purchase in builders’ inventories at the end of the month. At the end of October, there were 9,308 multi-family homes and 3,192 single-family homes available in the GTA.

“Demand for newly-built condominium apartments is being fueled by three key buyer groups – small investors who have become the de facto providers of new rental housing supply in the GTA; end user buyers who might prefer a single-family home but are seeking out more affordable options; and the more traditional end users who value the lifestyle and amenities of well-located projects,” said Patricia Arsenault, Altus Group’s executive vice president of research consulting services.

Prices of available new homes in October increased slightly for both single-family lowrise homes and multi-family homes. The average for available new single-family homes was $1,217,428 up from $1,204,829 in September, and 29.8 per cent above last October’s average price of $937,689. The average price for available new detached homes was $1,548,888 and the average for available new townhomes was $995,571.

Meanwhile the average price of available new condo apartments in highrise and midrise buildings and stacked townhomes was $677,456 in October, up from September’s $661,188. The average price per square foot was $791 and the average unit size was 857 square feet.

The Canadian Home Builders’ Association (CHBA) has named Bob Finnigan, partner at Herity (Heathwood Homes), CHBA Past President, member of BILD (GTA) and long-time building industry executive, as its Member of the Year.

Great Gulf and Tridel were among the big winners at the recent 39th Annual BILD Awards, as the Building Industry and Land Development Association (BILD) recognized the top builders and developers, projects and marketing initiatives in the industry.

Before you get the keys, you and your builder will do a Pre-Delivery Inspection or PDI. This is an important step – not only does it familiarize you with your new home but it also helps you protect your warranty rights.

Cosentino is a global, family-owned company that produces and distributes high value innovative surfaces for the world of architecture and design, leaders in their respective segments such as Silestone® Quartz surfaces and Dekton® Ultracompact surfaces. Technologically advanced surfaces that create unique designs for the home and public spaces.

Euro-Line Appliances has brought elite European engineered appliances to Canadian homes for over 25 years. Our brands exceed expectations and have earned awards in design, engineering, performance, and energy efficiency. All of our cooking, refrigeration, dishwashers, and laundry appliances are created to conserve our non-renewable resources.

Created by fusion of exceptional design, superior quartz quality and cutting-edge technology, HansStone Quartz weaves together intriguing patterns and colours inspired by the diverse Canadian landscape.

With over 90 years of experience, BLANCO is the leading kitchen sinks and faucets manufacturer. From handcrafted in Germany Steelart® sinks and the beauty of Silgranit®, to the European design faucets, BLANCO products are celebrated worldwide for their unmatched quality and design. Blanco Silgranit® sinks are proudly manufactured in Canada TRADE ONLY.

Since 1989 Men At Work has specialized in renewing and enlarging older houses in core Toronto neighbourhoods. We are experts in managing the challenges of renovating sensitive old buildings into beautiful, functional, comfortable living spaces.

SFA SANIFLO INC. (“SANIFLO”) is the only manufacturer of its kind in North America offering a complete line of macerating toilet systems for residential and light-commercial applications where installation of plumbing fixtures with below-floor drainage is impossible or cost-prohibitive.

Established in 1987, Caesarstone pioneered the original quartz surface and continues to be a leading developer and manufacturer of premium surfaces. Highly functional and design forward, Caesarstone surfaces have endless application possibilities including kitchen countertops, bathroom vanities, wall paneling, furniture and more.

Sharing Passion & Performance. With our unique expertise and sensibilities, gained from our devotion to sound and music, we are committed to creating excitement and cultural inspiration together with people around the world.

X-Tile is sure to have whatever you need to express your unique individual style. We offer you an exceptional variety of wall and flooring options in ceramic, porcelain, natural stone, glass, mosaic and much more from leading suppliers around the world. Let our knowledgeable and friendly staff help you in your dream renovation or building project.

Fisher & Paykel incorporates the world’s most innovative technologies and produce the most technically advanced, efficient and contemporary styled appliances. DCS created the first line of high end, commercial quality appliances and expanded to pioneer indoor and outdoor kitchen solutions for the at home chef. TRADE ONLY.

Through our customer feedback, we have learned the importance of ‘service’. You said and we listened. We addressed your needs and improvised; bringing you services and quality no one in the industry offers.

Fusion Stone is an easy and budget-friendly way to beautifully upgrade your home, inside and out. A patented Shouldice innovation, Fusion Stone is a thin stone veneer that is easily installed with the included stainless steel clips & screws. You just screw it to the wall and it’s “Hooked for Life”.

We've been proudly serving the community for more than 160 years. We deliver natural gas safely and reliably to two million homes and businesses across Ontario. With safety as our ongoing priority, we're committed to making communities better places to live.

When you buy a new car, one of the last steps before you drive it off the lot involves the salesperson showing you all the features of your vehicle and how they work. It’s the same with a new home. Before you get the keys, you and your builder will do a Pre-Delivery Inspection or PDI. This is an important step – not only does it familiarize you with your new home but it also helps you protect your warranty rights.
The PDI usually takes place a week or two before closing and involves a formal walk-through of the finished home with your builder. During this inspection, any defects, missing or non-functional items need to be noted on a PDI form. This form serves as a record of the state of the home when it was turned over.
Keep in mind however that this is not a warranty form.

Once you take possession, any issues that your builder has not resolved from your PDI – or any new issues that you’ve identified in your first month of ownership – should be recorded on a 30-Day warranty form and submitted to Tarion.

By far, the most common defects we see reported on the 30-Day forms are what are called ‘fit and finish’ issues. That can include scratches or scuffs on cabinetry or floors, cracked millwork, poorly-applied paint or uneven floor tiles.
These are all issues that can – and should – be identified during the PDI. If for example, you report gouges in your hardwood on your 30-Day form but it wasn’t on your PDI form, it may be hard to prove that they existed before you moved in. So here are a few tips to help you with your PDI:

Open and close all windows to be sure the latches work, screens are in place and windows slide freely on their tracks.

Make sure all doors are painted and that their locks work properly.

Look at the walls in each room to make sure there are no nail pops or visible seams. Check out the baseboard and woodwork around the doors to see if there are gaps that still need to be filled with caulking. Do all the light switches work? You should be checking each one. Check outlets with a small lamp or nightlight.

Test for squeaky floors as you walk around.

Check the bathtubs and sinks to make sure there are no scratches or chips.

Take photos of missing or damaged items. These will help with any future warranty claims.

If there’s construction debris, tarps or other things obstructing your view of areas of the home, it should be recorded on the form that you weren’t able to inspect that particular area.

Take your time, take a good look at everything and don’t let yourself be rushed. This is the time when a builder should be explaining how the appliances work, where you’ll find the water cut-off and how to operate your home’s mechanical and HVAC systems. We recommend that builders spend about one hour per 1,000 square feet on the PDI.

While your PDI is an opportunity to document the state of your home before you move in, once you take possession, your one-year, two-year and seven year warranties kick in. This warranty coverage is outlined in your Homeowner Information Package – something that your builder should provide you with either at the time of your PDI or when you receive the keys to your new home.
If they don’t, you can download a copy from tarion.com. If you have questions about the PDI or how to get the issues you may identify resolved, you can contact Tarion at 1.877.9TARION or email customerservice@tarion.com and our customer service team will be happy to help.
Howard Bogach is president and CEO of the Tarion Warranty Corp.
tarion.comFacebook.com/TarionWarrantyCorp

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